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Finance Dictionary and Glossary of Investment Terms
The total units of a security traded on the most recent trading day. Different people see different things in trading volume, but most people agree it means something. On the most basic level, unusually large volume means that important news has just come out, or will come out soon. Volume is also important in technical analysis. Rising volume coupled with a rising share price is considered a bullish indicator for a stock, while the opposite is considered a bearish indicator. Technical analysts also track a ""volume price trend"" to relate volume and price. On a day when a given stock closes higher, they record volume as a positive value, and on a day with a lower close they record volume as a negative value. Such a graph can shows whether a stock has more upward or downward strength. Some technical analysts believe that the biggest price gains are overwhelmingly associated with the heaviest volume trading.